Zymeworks Inc

Previous wording

Zanidatamab is a novel bispecific antibody that targets two distinct domains of the human epidermal growth factor receptor 2 (“HER2”). Zanidatamab’s unique binding properties result in multiple mechanisms of action that may enable it to address unmet need in patient populations with HER2-expressing cancers. We have entered into separate agreements with BeiGene, Ltd. (“BeiGene”) and Jazz Pharmaceuticals Ireland Limited, granting to each of them exclusive rights to develop and commercialize zanidatamab in different territories. Jazz Pharmaceuticals Ireland Limited and Jazz Pharmaceuticals, Inc. (“Jazz Inc.”) are both subsidiaries of Jazz Pharmaceuticals plc. Jazz Pharmaceuticals Ireland Limited, Jazz Inc. and Jazz Pharmaceuticals plc are referred to herein collectively as “Jazz”. For additional information regarding these agreements with BeiGene and Jazz, see the section titled “Strategic Partnerships and Collaborations” below. In May 2024, our partner Jazz announced that the FDA accepted and granted Priority Review of the Biologics License Application (“BLA”) for zanidatamab for the treatment of previously treated, unresectable, locally advanced, or metastatic HER2-positive biliary tract cancers (“BTC”). Under the Prescription Drug User Fee Act (“PDUFA”), the FDA has set a target action date of November 29, 2024. Jazz has also confirmed that the European Medicines Agency (“EMA”) has validated the Marketing Authorization Application (“MAA”) for zanidatamab in second-line (2L) BTC. Jazz has initiated a Phase 3 confirmatory trial for zanidatamab as first-line treatment in BTC. Based on the expected timeline and subject to approval, Jazz expects to launch zanidatamab for 2L BTC in the United States in the fourth quarter of 2024. Similarly, our partner BeiGene announced that the Center for Drug Evaluation (“CDE”) of the National Medical Products

Current wording

Zanidatamab is a novel bispecific antibody that targets two distinct domains of the human epidermal growth factor receptor 2 (“HER2”). Zanidatamab’s unique binding properties result in multiple mechanisms of action that may enable it to address unmet need in patient populations with HER2-expressing cancers. We have entered into separate agreements with BeiGene, Ltd. (“BeiGene”) and Jazz Pharmaceuticals Ireland Limited, granting to each of them exclusive rights to develop and commercialize zanidatamab in different territories. Jazz Pharmaceuticals Ireland Limited and Jazz Pharmaceuticals, Inc. (“Jazz Inc.”) are both subsidiaries of Jazz Pharmaceuticals plc. Jazz Pharmaceuticals Ireland Limited, Jazz Inc. and Jazz Pharmaceuticals plc are referred to herein collectively as “Jazz”. For additional information regarding these agreements with BeiGene and Jazz, see the section titled “Strategic Partnerships and Collaborations” below. In May 2024, our partner Jazz announced that the FDA accepted and granted Priority Review of the Biologics License Application (“BLA”) for zanidatamab for the treatment of previously treated, unresectable, locally advanced, or metastatic HER2-positive(“HER2+”)biliary tract cancers (“BTC”). Under the Prescription Drug User Fee Act (“PDUFA”), the FDA has set a target action date of November 29, 2024. Jazz has also confirmed that the European Medicines Agency (“EMA”) has validated the Marketing Authorization Application (“MAA”) for zanidatamab in second-line (2L) BTC. Jazz has initiated a Phase 3 confirmatory trial for zanidatamab as first-line treatment in BTC. Based on the expected timeline and subject to approval, Jazz expects to launch zanidatamab for 2L BTC in the United States in the fourth quarter of 2024. Similarly, our partner BeiGene announced that the Center for Drug Evaluation (“CDE”) of the National Medical

Previous wording

Administration (“NMPA”) in China accepted the BLA for zanidatamab for second-line treatment of HER2-positive BTC. Jazz is also evaluating zanidatamab for the first-line treatment of HER2-positive unresectable locally advanced or metastatic gastroesophageal adenocarcinomas (“GEA”). The pivotal HERIZON-GEA-01 trial is ongoing and enrollment remains on track. Based on a blinded assessment of progression events, Jazz estimates top-line progression-free survival (“PFS”) data will be available in the second quarter of 2025. Jazz continues to track events in the trial relative to the initial protocol assumptions. In July 2024, Jazz announced that it had initiated the Phase 3 EmpowHER-BC-303 trial to evaluate zanidatamab plus chemotherapy or trastuzumab plus chemotherapy in patients with HER2-positive breast cancer whose disease has progressed on previous trastuzumab deruxtecan (T-DXd) treatment.

Current wording

Products Administration (“NMPA”) in China accepted the BLA for zanidatamab for second-line treatment of HER2+ BTC. Jazz is also evaluating zanidatamab for the first-line treatment of HER2+ unresectable locally advanced or metastatic gastroesophageal adenocarcinomas (“GEA”). The pivotal HERIZON-GEA-01 trial is ongoing and Jazz has estimated top-line progression-free survival (“PFS”) data will be available in the second quarter of 2025. In July 2024, Jazz announced that it had initiated the Phase 3 EmpowHER-BC-303 trial to evaluate zanidatamab plus chemotherapy or trastuzumab plus chemotherapy in patients with HER2+ breast cancer whose disease has progressed on previous trastuzumab deruxtecan (T-DXd) treatment.

Previous wording

•ZW191, a clinical-stage ADC that targets folate receptor alpha (“FRα”)-expressing tumors including ovarian, other gynecological, and NSCLC, is built using our drug conjugate platforms, including our novel bystander active TOPO1i-based payload technology. A drug-antibody-ratio (“DAR”) of eight was selected to balance tolerability and efficacy. The FRα monoclonal antibody (“mAb”) incorporated in ZW191 was generated in-house and selected based on enhanced internalization characteristics to enable targeting of high, mid, and low levels of FRα expression. FRα is a clinically validated target, and data supports its expression in approximately 75% of ovarian carcinomas and in 70% of NSCLC. Preclinical data is encouraging, demonstrating strong activity across a range of FRα-expressing patient-derived xenografts and superior internalization, payload delivery and tissue penetration compared to multiple FRα mAbs from other ADCs. ZW191 has achieved a highest non-severely toxic dose in non-human primates of 60 mg/kg, which presents a compelling profile and enables the expectation of achieving an efficacious dose level in the Phase 1 clinical trial. The investigational new drug (“IND”) application for ZW191 has been cleared by the FDA, and the Company The Company expects to initiate clinical development of ZW191 during 2024. The Company is actively progressing applications seeking regulatory permission to commence first-in-human clinical studies for ZW191 in non-U.S. jurisdictions in the second half of 2024.

Current wording

•ZW191, a clinical-stage ADC that targets folate receptor alpha (“FRα”)-expressing tumors including ovarian, other gynecological, and non-small cell lung cancer (“NSCLC”), is built using our drug conjugate platforms, including our novel bystander active TOPO1i-based payload technology. A drug-antibody-ratio (“DAR”) of eight was selected, as well asa moderate stability antibody-linker, to balance tolerability and efficacy. The FRα monoclonal antibody (“mAb”) incorporated in ZW191 was generated in-house and selected based on enhanced internalization characteristics to enable targeting of high, mid, and low levels of FRα expression. FRα is a clinically validated target, and data supports its expression in approximately 75% of high-grade serous ovarian carcinomas and in 70% of NSCLC. Preclinical data is encouraging, demonstrating strong activity across a range of FRα-expressing patient-derived xenografts and superior internalization, payload delivery and tissue penetration compared to multiple FRα mAbs from other ADCs. ZW191 has achieved a highest non-severely toxic dose in non-human primates of 60 mg/kg, which presents a compelling profile and enables the expectation of achieving an efficacious dose level in the Phase 1 clinical trial. The IND application for ZW191 has been cleared bythe FDA. The Company is actively recruiting patients in the global Phase 1, open-label, multicenter study of ZW191, registered under NCT06555744 on clinicaltrials.gov. The study aims to enroll 145 participants with advanced solid tumors across North America, Europe, and the Asia-Pacific region. The study is designed to evaluate the safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity of ascending doses of ZW191.

Previous wording

•ZW171, a clinical-stage multispecific antibody built using our Azymetric platform, is a novel 2 + 1 format T cell engaging multispecific antibody targeting mesothelin (“MSLN”)-expressing cancers. ZW171 has a unique geometry, with two single-chain fragment variable arms targeting MSLN and one Fab arm targeting the cluster of differentiation 3 protein (“CD3”) component of the T cell receptor, to redirect the body’s natural immune system to fight cancer cells. Preclinical data demonstrated in vivo anti-tumor activity, with engagement in high-expressing cells but not low-expressing cells, mitigating the risk of on-target, off-tumor toxicities. MSLN has strong expression in ovarian cancer (~84%), with moderate to strong expression levels across mesothelioma (~56%) and NSCLC (~36% ), making it an appealing target for therapeutic development with our proprietary T cell engager technology. The IND application for ZW171 has been cleared by the FDA. The Company plans to initiate clinical development of ZW171 during 2024 and is actively progressing applications seeking regulatory permission to commence first-in-human clinical studies for ZW171 in non-U.S. jurisdictions in the second half of 2024. The Phase 1, open-label, multicenter study of ZW171, registered under NCT06523803 on clinicaltrials.gov, aims to enroll 160 participants with advanced or metastatic ovarian cancer, NSCLC, and other mesothelin-expressing cancers across North America, Europe, and the Asia-Pacific region. The study is designed to first evaluate the initial safety and tolerability and anti-tumor effect of different ascending doses of ZW171, followed by a second part of the study in larger numbers of participants with some selected doses to further evaluate safety, tolerability and the anti-tumor effects of ZW171.

Current wording

•ZW171, a clinical-stage multispecific antibody built using our Azymetric platform, is a novel 2 + 1 format T cell engaging multispecific antibody targeting mesothelin (“MSLN”)-expressing cancers. ZW171 has a unique geometry, with two single-chain fragment variable arms targeting MSLN and one Fab arm targeting the cluster of differentiation 3 protein (“CD3”) component of the T cell receptor, to redirect the body’s natural immune system to fight cancer cells. Preclinical data demonstrated in vivo anti-tumor activity, with engagement in high-expressing cells but not low-expressing cells, mitigating the risk of on-target, off-tumor toxicities. MSLN has strong expression in ovarian cancer (~84%), with moderate to strong expression in NSCLC (~36% ), making it an appealing target for therapeutic development with our proprietary T cell engager technology. In preclinical studies, ZW171 has demonstrated in vivo potent preferential killing of MSLN-overexpressing target cells and stimulation MSLN-dependent T cell activation, mitigating the risk of on-target-off tumor toxicity and peripheral T cell activation and cytokine release syndrome. Preclinical data demonstrated that ZW171 exhibits greater anti-tumor activity compared to benchmark in MSLN-expressing tumor models and is well tolerated in cynomolgus monkeys up to 30 mg/kg. In October 2024, we announced the first patient dosed in the Phase 1 clinical trial for ZW 171. The global Phase 1, open-label, multicenter study of ZW171, registered under NCT06523803 on clinicaltrials.gov, is expected to enroll approximately 160 adult patients with advanced MSLN-expressing cancers in North America, Europe, and the Asia-Pacific region. The study is designed to evaluate the safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity of ascending doses of ZW171.

Previous wording

•ZW220, an ADC that targets sodium-dependent phosphate transporter 2b (“NaPi2b”)-expressing NSCLC and ovarian cancer, is (like ZW191) built using our proprietary TOPO1i-based payload technology. The NaPi2b-targeting monospecific antibody incorporated in ZW220 was generated in-house and selected based on a favorable binding profile and enhanced internalization properties to enable targeting of both high- and low-expressing NaPi2b-expressing tumors. A DAR of four was selected to balance tolerability and efficacy, with the fragment crystallizable (“Fc”) gamma receptor being silenced with the goal to minimize potential toxicities associated with this target. NaPi2b is expressed in approximately 96% of ovarian and 87% of NSCLC, with anti-tumor activity being demonstrated in patient-derived cell lines and growth inhibition in 3D spheroid NSCLC models (data generated using ZW220 that had a wildtype Fc region of the antibody). The bystander effect of the TOPO1i payload may help address NaPi2b heterogeneity across different cancers.

Current wording

•ZW220, an ADC that targets sodium-dependent phosphate transporter 2b (“NaPi2b”)-expressing NSCLC and ovarian cancer, and is built, like ZW191, using our proprietary TOPO1i-based payload technology. The NaPi2b-targeting monospecific antibody incorporated in ZW220 was developed in-house and selected based on a favorable binding profile and enhanced internalization properties to enable targeting of both high- and low-expressing NaPi2b-expressing tumors. A DAR of four was selected, as well asa moderate stability antibody-linker, to balance tolerability and efficacy, with the fragment crystallizable (“Fc”) gamma receptor being silenced with the goal to minimize potential toxicities associated with this target. NaPi2b is expressed in approximately 96% of ovarian and 87% of NSCLC, with anti-tumor activity being demonstrated in patient-derived cell lines and growth inhibition in 3D spheroid NSCLC models (data generated using ZW220 that had a wildtype Fc region of the antibody). The bystander effect of the TOPO1i payload may help address NaPi2b heterogeneity across different cancers. Preclinical data demonstrate high tolerability in animal studies with MTD ≥90 mg/kg in non-human primates and ≥200 mg/kg in rats, suggesting potential for high doses in humans.

Previous wording

•ZW251, a potential first-in-class ADC molecule designed for the treatment of glypican 3 (“GPC3”)-expressing hepatocellular carcinoma (“HCC”), which incorporates the same Zymeworks proprietary bystander-active TOPO1i payload utilized in ZW191 (anti-FRα) and ZW220 (anti-NaPi2b). A DAR of four was selected to balance tolerability and efficacy, with ZW251 anti-tumor activity observed in multiple patient-derived xenograft models of HCC reflecting a range of GPC3 over-expression. GPC3, a glycosylphosphatidylinositol (“GPI”)-anchored cell surface oncofetal antigen, is over-expressed in most HCC patients (>75%), and displays minimal normal adult tissue expression, making it an appealing ADC target. We are encouraged by published research demonstrating the potential of GPC3-targeting antibody in HCC patients as evidenced by tumor localization of iodine radiolabeled condrituzumab, a prior clinical-stage anti-GPC3 mAb, and believe that ADC-based targeting of GPC3 could enable a novel and effective approach to treatment of HCC.

Current wording

•ZW251, a potential first-in-class ADC molecule designed for the treatment of glypican 3 (“GPC3”)-expressing hepatocellular carcinoma (“HCC”), which incorporates the same Zymeworks proprietary bystander-active TOPO1i payload utilized in ZW191 (anti-FRα) and ZW220 (anti-NaPi2b). A DAR of four was selected, as well asa moderate stability antibody-linker, to balance tolerability and efficacy. In preclinical studies, anti-tumor activity for ZW251 was observed in multiple patient-derived xenograft models of HCC reflecting a range of GPC3 over-expression. GPC3, a glycosylphosphatidylinositol (“GPI”)-anchored cell surface oncofetal antigen, is over-expressed in most HCC patients (>75%), and displays minimal normal adult tissue expression, making it an appealing ADC target. In non-human primate studies, ZW251 displayed significant tolerability at doses up to 120 mg/kg, suggesting the possibility of high initial dosing in human trials. We are encouraged by published research demonstrating the potential of GPC3-targeting antibody in HCC patients as evidenced by tumor localization of iodine radiolabeled condrituzumab, a prior clinical-stage anti-GPC3 mAb, and believe that ADC-based targeting of GPC3 could enable a novel and effective approach to treatment of HCC.

Previous wording

We have received FDA clearance for our IND applications for ZW171 and ZW191, and are actively progressing submissions for non-U.S. applications for both product candidates in 2024. Similarly, we expect to submit INDs and non-U.S. applications for ZW220 and ZW251 in 2025. Beyond this, we aim to nominate the preclinical candidate for our fifth development program during 2024, and intend to submit an IND and non-U.S. applications for this candidate in 2026.

Current wording

We have received FDA clearance for our IND applications for ZW171 and ZW191, and Phase 1 studies for both candidates are now actively recruiting. Similarly, we expect to submit INDs and non-U.S. applications for ZW220 in the first half of 2025, and ZW251 in the second half of 2025. Beyond this, we aim to nominate the preclinical candidate for our fifth development program during 2024, and intend to submit an IND and non-U.S. applications for this candidate in the first half of 2026.

Previous wording

Since our initial public offering (“IPO”) in 2017, we have funded our operations primarily through follow-on public offerings, including the issuance of pre-funded warrants, and payments received under our license and collaboration agreements. Payments received or receivables from our license and collaboration agreements include upfront fees, milestone payments, as well as research support and reimbursement payments. Prior to our IPO, we also received financing from private equity placements and the issuance of convertible debt, which was subsequently converted into equity securities, and a credit facility. From inception to June 30, 2024, we received $996.4 million, net of equity issuance costs, from these sources of financing including proceeds from exercises of stock options and employee stock purchase plans. As of June 30, 2024, we had $395.9 million of cash resources consisting of cash, cash equivalents and marketable securities.

Current wording

Since our initial public offering (“IPO”) in 2017, we have funded our operations primarily through follow-on public offerings, including the issuance of pre-funded warrants, and payments received under our license and collaboration agreements. Payments received or receivables from our license and collaboration agreements include upfront fees, milestone payments, as well as research support and reimbursement payments. Prior to our IPO, we also received financing from private equity placements and the issuance of convertible debt, which was subsequently converted into equity securities, and a credit facility. From inception to September 30, 2024, we received $1,002.2 million, net of equity issuance costs, from these sources of financing including proceeds from exercises of stock options and employee stock purchase plans. As of September 30, 2024, we had $374.9 million of cash resources consisting of cash, cash equivalents and marketable securities.

Previous wording

We reported a net loss of $69.3 million for the six months ended June 30, 2024 and through June 30, 2024, we had an accumulated deficit of $746.8 million. Over the next several years, we expect to continue to incur losses as we increase our research and development expenditures in connection with the ongoing development of our product candidates and other clinical, preclinical and regulatory activities.

Current wording

We reported a net loss of $99.2 million for the nine months ended September 30, 2024 and through September 30, 2024, we had an accumulated deficit of $797.8 million. Over the next several years, we expect to continue to incur losses as we increase our research and development expenditures in connection with the ongoing development of our product candidates and other clinical, preclinical and regulatory activities.

Previous wording

Through collaboration agree ments with Jazz and BeiGene relating to our lead programs for zanidatamab and zanidatamab zovodotin, we have received over $435 million through June 30, 2024 in the form of non-refundable upfront payments and milestone payments. In addition, through these partnerships with Jazz and BeiGene with respect to zanidatamab, as of June 30, 2024, we remain eligible to receive up to $1.56 billion in potential regulatory, development and commercial milestone payments, as well as tiered royalties on potential future product sales, pending receipt of regulatory approval. These partnerships have provided us with a significant source of non-dilutive funding and provide for additional future funding for our lead asset, zanidatamab. These partnerships also leverage our partners’ commercial infrastructure, helping accelerate the development and expanding the potential reach of our lead product candidates.

Current wording

Through collaboration agree ments with Jazz and BeiGene relating to our lead programs for zanidatamab and zanidatamab zovodotin, we have received $446.0 million through September 30, 2024 in the form of non-refundable upfront payments and milestone payments. In addition, through these partnerships with Jazz and BeiGene with respect to zanidatamab, as of September 30, 2024, we remain eligible to receive up to $1.55 billion in potential regulatory, development and commercial milestone payments, as well as tiered royalties on potential future product sales, pending receipt of regulatory approval. These partnerships have provided us with a significant source of non-dilutive funding and provide for additional future funding for our lead asset, zanidatamab. These partnerships also leverage our partners’ commercial infrastructure, helping accelerate the development and expanding the potential reach of our lead product candidates.

Previous wording

In addition to the payments we have received through our collaboration agreements with Jazz and BeiGene relating to zanidatamab and zanidatamab zovodotin as described above, as of June 30, 2024, we have received approximately $180.0 million in the form of non-refundable upfront and milestone payments from platform partnership and collaboration agreements. We continue to have revenue-generating strategic partnerships and collaborations with respect to our Azymetric, EFECT and drug conjugate therapeutic platforms with the following pharmaceutical companies: Celgene Corporation and Celgene Alpine Investment Co. LLC (now a Bristol-Myers Squibb company, “BMS”), GlaxoSmithKline Intellectual Property Development Limited (“GSK”), Daiichi Sankyo Co., Ltd. (“Daiichi Sankyo”), Janssen Biotech, Inc. (“Janssen”), Iconic Therapeutics, Inc. (“Iconic”), and Merck Sharp & Dohme Research GmbH (“Merck”). During the three months ended June 30, 2024, the research program term under our agreement with BMS expired with respect to eight of the ten programs thereunder. Following such expiration, as of June 30, 2024, we remain eligible to receive up to $1.03 billion in preclinical and development milestone payments and up to $3.08 billion in commercial milestone payments, as well as tiered royalties on potential future product sales, pending regulatory approval. It is possible, however, that our strategic partners’ programs will not advance as currently contemplated, which would negatively affect the amount of development and commercial milestone payments and royalties on potential future product sales we may receive. Importantly, these partnerships include predominantly non-target-exclusive licenses for any of our therapeutic platforms, so we maintain the ability to develop therapeutics directed to many high-value targets utilizing our platforms.

Current wording

In addition to the payments we have received through our collaboration agreements with Jazz and BeiGene relating to zanidatamab and zanidatamab zovodotin as described above, as of September 30, 2024, we have received $181.0 million in the form of non-refundable upfront and milestone payments from platform partnership and collaboration agreements. We continue to have revenue-generating strategic partnerships and collaborations with respect to our Azymetric, EFECT and drug conjugate therapeutic platforms with the following pharmaceutical companies: Celgene Corporation and Celgene Alpine Investment Co. LLC (now a Bristol-Myers Squibb company, “BMS”), GlaxoSmithKline Intellectual Property Development Limited (“GSK”), Daiichi Sankyo Co., Ltd. (“Daiichi Sankyo”), Janssen Biotech, Inc. (“Janssen”), Iconic Therapeutics, Inc. (“Iconic”), and Merck Sharp & Dohme Research GmbH (“Merck”). As of September 30, 2024, we remain eligible to receive up to $1.03 billion in preclinical and development milestone payments and up to $3.08 billion in commercial milestone payments, as well as tiered royalties on potential future product sales, pending regulatory approval. It is possible, however, that our strategic partners’ programs will not advance as currently contemplated, which would negatively affect the amount of development and commercial milestone payments and royalties on potential future product sales we may receive. Importantly, these partnerships include predominantly non-target-exclusive licenses for any of our therapeutic platforms, so we maintain the ability to develop therapeutics directed to many high-value targets utilizing our platforms.

Previous wording

There have been no material changes in our critical accounting policies and significant judgments and estimates during the three and six months ended June 30, 2024 as compared to what has been described in our most recent annual consolidated financial statements.

Current wording

There have been no material changes in our critical accounting policies and significant judgments and estimates during the three and nine months ended September 30, 2024 as compared to what has been described in our most recent annual consolidated financial statements except as disclosed in note 8c to the interim consolidated financial statements.

Previous wording

Results of Operations for the Three and Six Months Ended June 30, 2024 and 2023

Current wording

Results of Operations for the Three and Nine Months Ended September 30, 2024 and 2023

Previous wording

Total revenue increased by $12.2 million in the three months ended June 30, 2024 compared to the same period in 2023. Revenue for the three months ended June 30, 2024 included $10.8 million for development support and drug supply revenue from Jazz, $8.0 million of milestone revenue from BeiGene in relation to the acceptance by the CDE of the NMPA in China of the BLA for zanidatamab for second-line treatment of HER2-positive BTC and $0.4 million from BeiGene for research support payments. Revenue for the same period in 2023 included $26.6 million for development support from Jazz, which was partially offset by a $20.1 million credit, issued to Jazz for contractual amendments to our partnership arrangement, and $0.5 million from our partners for research support and other payments.

Current wording

Total revenue decreased by $0.5 million in the three months ended September 30, 2024 compared to the same period in 2023. Revenue for the three months ended September 30, 2024 included $12.1 million for development support and drug supply revenue from Jazz and $2.5 million of milestone revenue from GSK in relation to the sequence pair nomination under the 2016 licensing agreement, and $1.4 million of drug supply revenue from BeiGene. Revenue for the same period in 2023 included $15.4 million for development support and drug supply revenue from Jazz, $0.9 million of development support and drug supply revenue from BeiGene and $0.2 million from our partners for research support and other payments.

Previous wording

Total revenue decreased by $13.3 million in the six months ended June 30, 2024 compared to the same period in 2023. Revenue for the six months ended June 30, 2024 included $20.7 million for development support and drug supply revenue from Jazz, $8.0 million of milestone revenue from BeiGene in relation to the acceptance by the CDE of the NMPA in China of the BLA for zanidatamab for second-line treatment of HER2-positive BTC, $0.4 million from BeiGene for research support payments and $0.2 million from our partners for research support and other payments. Revenue for the same period in 2023 included $61.0 million for development support and drug supply revenue from Jazz, which was partially offset by a $20.1 million credit, issued to Jazz for contractual amendments to our partnership arrangement, and $1.7 million from BeiGene and our other partners for research support and other payments. The decrease in revenue from Jazz reflects the transfer of responsibility for certain clinical trials regarding zanidatamab to Jazz pursuant to the Transfer Agreement (as defined below) and the Amended Jazz Collaboration Agreement, with such future costs to be borne by Jazz instead of being incurred by us and reimbursed by Jazz.

Current wording

Total revenue decreased by $13.8 million in the nine months ended September 30, 2024 compared to the same period in 2023. Revenue for the nine months ended September 30, 2024 included $32.8 million for development support and drug supply revenue from Jazz, $8.0 million of milestone revenue from BeiGene in relation to the acceptance by the CDE of the NMPA in China of the BLA for zanidatamab for second-line treatment of HER2+ BTC, $2.5 million of milestone revenue from GSK in relation to the sequence pair nomination under the 2016 licensing agreement, $1.8 million from BeiGene for research support payments and $0.2 million from our partners for research support and other payments. Revenue for the same period in 2023 included $76.4 million for development support and drug supply revenue from Jazz, which was partially offset by a $20.1 million credit, issued to Jazz for contractual amendments to our partnership arrangement, and $2.8 million from BeiGene and our other partners for research support and other payments. The decrease in revenue from Jazz reflects the transfer of responsibility for certain clinical trials regarding zanidatamab to Jazz pursuant to the Transfer Agreement (as defined below) and the Amended Jazz Collaboration Agreement, with such future costs to be borne by Jazz instead of being incurred by us and reimbursed by Jazz.

Previous wording

Research and development expense decreased by $24.1 million for the six months ended June 30, 2024 compared to the same period in 2023. The decrease in research and development expense was primarily due to a decrease in expenses for zanidatamab as a result of transfer of responsibility for this program to Jazz per our Transfer Agreement and the Amended Jazz Collaboration Agreement. This decrease, compared to the same period in 2023, was partially offset by an increase in expenses of other development programs, primarily with respect to product candidates ZW171 and ZW251, costs incurred for manufacturing activities to support the IND for ZW220, and other preclinical and research programs. Salaries and benefits expenses decreased compared to the same period in 2023, due to non-recurring severance expenses in 2023, which was partially offset by an increase in stock-based compensation expense in 2024.

Current wording

Research and development expense increased by $3.6 million for the three months ended September 30, 2024 compared to the same period in 2023. The increase in research and development expense was primarily due to an increase in expenses for ZW220 and ZW251 and other preclinical and research activities, which were partially offset by a decrease in expenses for ZW171 and ZW191. Salaries and benefits and stock-based compensation expense in 2024 increased primarily due to an increase in headcount in 2024 compared to same period in 2023.

Previous wording

Research and development expense decreased by $10.2 million for the three months ended June 30, 2024 compared to the same period in 2023. The decrease in research and development expense was primarily due to a decrease in expenses for zanidatamab as a result of transfer of responsibility for this program to Jazz per our Transfer Agreement and the Amended Jazz Collaboration Agreement. This decrease, compared to the same period in 2023, was partially offset by an increase in expenses, primarily with respect to preclinical product candidates ZW220 and ZW251, which were partially offset by a decrease in expenses for ZW171 and ZW191. Stock-based compensation expense in 2024 increased primarily due to net recovery in 2023 as a result of transfer of employees to Jazz per the transfer of zanidatamab development program. This was partially offset by decrease in salaries and benefits expenses due to non-recurring severance expenses in 2023.

Current wording

Research and development expense decreased by $20.5 million for the nine months ended September 30, 2024 compared to the same period in 2023. The decrease in research and development expense was primarily due to a decrease in expenses for zanidatamab, as a result of transfer of responsibility for this program to Jazz per our Transfer Agreement and the Amended Jazz Collaboration Agreement, and a decrease in expenses for ZW171 and ZW191. This decrease, compared to the same period in 2023, was partially offset by an increase in expenses for ZW220 and ZW251 and other preclinical and research activities. Stock-based compensation expense increased primarily due to a lower expense in 2023 as a result of the cancellation and modification of awards in respect of employees transferred to Jazz per the Transfer Agreement.

Previous wording

Our research and development expenses relating to zanidatamab, following the May 2023 transfer of responsibility for the zanidatamab development program to Jazz, have decreased significantly compared to the three and six months ended June 30, 2023. We expect to continue incurring research and development expenses for activities over which we maintain responsibility under the Amended Jazz Collaboration Agreement and for costs of third party services and other expenses under certain contracts being transferred to Jazz pursuant to the Transfer Agreement. We are eligible for reimbursement of these expenses from Jazz and expect to recognize these reimbursements as revenue from research and collaborations. We similarly expect that research and development expenses relating to zanidatamab zovodotin will decrease significantly in future periods following our decision to discontinue the zanidatamab zovodotin clinical development program.

Current wording

Our research and development expenses relating to zanidatamab, following the May 2023 transfer of responsibility for the zanidatamab development program to Jazz, have decreased compared to the three and nine months ended September 30, 2023. We expect to continue incurring research and development expenses for activities over which we maintain responsibility under the Amended Jazz Collaboration Agreement and for costs of third party services and other expenses under certain contracts being transferred to Jazz pursuant to the Transfer Agreement. We are eligible for reimbursement of these expenses from Jazz and expect to recognize these reimbursements as revenue from research and collaborations. We similarly expect that research and development expenses relating to zanidatamab zovodotin will decrease in future periods following our decision to discontinue the zanidatamab zovodotin clinical development program.

Previous wording

General and administrative expense decreased by $6.0 million for the three months ended June 30, 2024 compared to the same period in 2023. The decrease in general and administrative expense was primarily due to a decrease in external consulting expenses for information technology, legal fees and insurance costs, as well as depreciation and amortization expenses compared to the same period in 2023. This was partially offset by costs due to the termination of our long-term facility lease in Seattle in 2024.

Current wording

General and administrative expense decreased by $3.1 million for the three months ended September 30, 2024 compared to the same period in 2023. The decrease in general and administrative expense was primarily due to a decrease in external consulting expenses for information technology, legal fees and insurance, as well as depreciation and amortization expenses compared to the same period in 2023. This was partially offset by an increase in stock-based compensation expenses compared to the same period in 2023, primarily due to the reversal of compensation expense due to options cancellations in 2023.

Previous wording

General and administrative expense decreased by $7.1 million for the six months ended June 30, 2024 compared to the same period in 2023. The decrease in general and administrative expense was primarily due to a decrease in external consulting expenses for information technology, legal fees, and other expenses for advisory services, a reduction in insurance costs and a decrease in depreciation and amortization expenses, compared to the same period in 2023. This was partially offset by costs due to the termination of our long-term facility lease in Seattle in 2024.

Current wording

General and administrative expense decreased by $10.3 million for the nine months ended September 30, 2024 compared to the same period in 2023. The decrease in general and administrative expense was primarily due to a decrease in external consulting expenses for information technology, legal fees, and other expenses for advisory services, insurance and depreciation and amortization expenses compared to the same period in 2023. This was partially offset by costs incurred due to the termination of our long-term facility lease in Seattle in 2024 and an increase in stock-based compensation expense over 2023, primarily due to reversal of compensation expense for options cancellations and modifications in 2023.

Previous wording

During the three and six months ended June 30, 2024, we recorded an impairment charge of $17.3 million as a result of our decision to discontinue the zanidatamab zovodotin clinical development program which utilized the technology represented by acquired IPR&D assets.

Current wording

During the nine months ended September 30, 2024, we recorded an impairment charge of $17.3 million as a result of our decision to discontinue the zanidatamab zovodotin clinical development program which utilized the technology represented by acquired IPR&D assets.

Previous wording

Other income, net increased by $2.6 million for the six months ended June 30, 2024 compared to the same period in 2023. Other income, net for 2024 included $11.1 million in interest income and $0.4 million in net foreign exchange gain and other miscellaneous income. Other income, net for the six months ended June 30, 2023 included $9.6 million in interest income and a $0.7 million net foreign exchange loss and other miscellaneous amounts. The increase in interest income was driven by higher rates of return on, and partially offset by a reduction in the balances of, our cash, cash equivalents and marketable securities, due to operating cash requirements.

Current wording

Other income, net decreased by $1.1 million for the three months ended September 30, 2024 compared to the same period in 2023. Other income, net for 2024 included $4.8 million in interest income partially offset by $0.2 million in net foreign exchange loss and other miscellaneous expense. Other income, net for the three months ended September 30, 2023 included $5.0 million in interest income and a $0.6 million net foreign exchange gain and other miscellaneous amounts. The decrease in interest income was due to a reduction in the balances of our cash, cash equivalents and marketable securities, due to operating cash requirements, and due to a decrease in the average yield of these investments compared to the same period in 2023.

Previous wording

Other income, net increased by $0.7 million for the three months ended June 30, 2024 compared to the same period in 2023. Other income, net for 2024 included $5.2 million in interest income and $0.1 million in net foreign exchange gain and other miscellaneous income. Other income, net for the three months ended June 30, 2023 included $4.8 million in interest income and a

Current wording

Other income, net increased by $1.5 million for the nine months ended September 30, 2024 compared to the same period in 2023. Other income, net for 2024 included $15.9 million in interest income and $0.2 million in net foreign exchange gain and other miscellaneous income. Other income, net for the nine months ended September 30, 2023 included $14.7 million in interest income partially offset by a $0.1 million in net loss which includes foreign exchange loss and other miscellaneous income. The increase in interest income was primarily driven by an increase in the average interest yields of these investments during the period.

Previous wording

Income tax expense decreased by $1.6 million and $2.9 million for the three and six months ended June 30, 2024 compared to the same periods in 2023, primarily due to a reduction in U.S. taxes under the global intangible low-taxed income rules and Subpart F income rules.

Current wording

Income tax expense decreased by $0.9 million and $3.8 million for the three and nine months ended September 30, 2024, respectively, compared to the same periods in 2023, primarily due to a reduction in U.S. taxes under the global intangible low-taxed income rules and Subpart F income rules.

Previous wording

In November, 2022, we entered into a sales agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”) to sell shares of our common stock subject to a maximum aggregate dollar amount registered pursuant to an applicable prospectus supplement, from time to time, through an “at-the-market” equity offering program under which Cantor would act as our sales agent. In June 2023, we sold an aggregate of 3,350,000 shares of common stock at $8.12 per share under the Sales Agreement. We received gross proceeds of $27.2 million and net cash proceeds of $26.2 million, after underwriting commissions and offering expenses. On July 29, 2024, we notified Cantor of our decision to terminate the Sales Agreement effective July 31, 2024. As part of the ongoing management of our operations and related funding needs, we evaluate various financing vehicles, including “at-the-market” equity offering programs, and may enter into similar “at-the-market” equity offering programs in the future, as well as other financing transactions.

Current wording

In November, 2022, we entered into a sales agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”) to sell shares of our common stock subject to a maximum aggregate dollar amount registered pursuant to an applicable prospectus supplement, from time to time, through an “at-the-market” equity offering program under which Cantor would act as our sales agent. In June 2023, we sold an aggregate of 3,350,000 shares of common stock at $8.12 per share under the Sales Agreement. We received gross proceeds of $27.2 million and net cash proceeds of $26.2 million, after underwriting commissions and offering expenses. On July 29, 2024, we notified Cantor of our decision to terminate the Sales Agreement effective July 31, 2024.

Previous wording

As of June 30, 2024, we had $395.9 million of cash, cash equivalents, and marketable securities, comprised of $71.0 million in cash and cash equivalents and $325.0 million in marketable securities.

Current wording

As of September 30, 2024, we had $374.9 million of cash, cash equivalents, and marketable securities, comprised of $122.4 million in cash and cash equivalents and $252.5 million in marketable securities.

Previous wording

The following table represents a summary of our cash flows for the six months ended June 30, 2024 and 2023:

Current wording

The following table represents a summary of our cash flows for the nine months ended September 30, 2024 and 2023:

Previous wording

During the six months ended June 30, 2024, cash used in operating activities was $62.7 million compared to $89.6 million for the same period in the prior year. The decrease in net cash used in operating activities was primarily due to a decrease in cash expenditures for operations as a result of transfer of responsibility over the zanidatamab program to Jazz and favorable movements in working capital compared to the same period in the prior year. This was partly offset by an increase in payments for our other preclinical and clinical product candidates.

Current wording

During the nine months ended September 30, 2024, cash used in operating activities was $68.5 million compared to $132.3 million for the same period in the prior year. The decrease in net cash used in operating activities was primarily due to a decrease in cash expenditures for operations as a result of transfer of responsibility over the zanidatamab program to Jazz and favorable movements in working capital compared to the same period in the prior year. This was partly offset by an increase in payments for our other preclinical and clinical product candidates.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2024 primarily related to net purchases of marketable securities of $25.5 million and cash outflows of $1.8 million for the expenditures for software implementation and acquisition of property and equipment in our office and laboratory spaces in Canada and the United States. Net cash used in investing activities for the six month period ended June 30, 2023 primarily related to net purchases of marketable securities of $197.7 million partially offset by cash outflows of $1.2 million for the acquisition of property and equipment in relation to our office and lab spaces in Canada.

Current wording

Net cash provided by investing activities for the nine months ended September 30, 2024 primarily related to net proceeds from marketable securities of $47.7 million and cash outflows of $2.8 million for the expenditures for software implementation and acquisition of property and equipment in our office and laboratory spaces in Canada and the United States. Net cash used in investing activities for the nine month period ended September 30, 2023 primarily related to net purchases of marketable securities of $203.6 million and cash outflows of $2.3 million for the acquisition of property and equipment in relation to our office and lab spaces in Canada.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2024 included net proceeds of $2.9 million from stock option exercises and $0.4 million from the issuance of shares of common stock under our employee stock purchase plan. Net cash provided by financing activities for the six months ended June 30, 2023 included net proceeds of $26.2 million from our share issuance pursuant to the Sales Agreement, net proceeds of $2.9 million from stock option exercises and $0.2 million from the issuance of shares of common stock in relation to our employee stock purchase plan.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2024 included $20.6 million used for the Repurchase Program partially offset by net proceeds of $8.1 million from stock option exercises and $0.9 million from the issuance of shares of common stock under our employee stock purchase plan. Net cash provided by financing activities for the nine months ended September 30, 2023 included net proceeds of $26.2 million from our share issuance pursuant to the Sales Agreement, net proceeds of $4.2 million from stock option exercises and $0.8 million from the issuance of shares of common stock in relation to our employee stock purchase plan.

Previous wording

Additionally, on August 1, 2024, our board of directors authorized the Share Repurchase Program, under which we may repurchase up to $60.0 million of our common stock. The shares may be repurchased from time to time in open market transactions, or other means in accordance with Rule 10b5-1 of the Exchange Act and Rule 10b-18 of the Exchange Act. The timing, number of shares repurchased, and prices paid for the shares under this program will depend on general business and market conditions as well as corporate and regulatory limitations, prevailing stock prices, and other considerations. The Share Repurchase Program may be suspended or discontinued at any time and does not obligate us to acquire any amount of common stock.

Current wording

Additionally, on August 1, 2024, our board of directors authorized the Repurchase Program, under which we may repurchase up to $60.0 million of our common stock. The shares may be repurchased from time to time in open market transactions, or other means in accordance with Rule 10b5-1 of the Exchange Act and Rule 10b-18 of the Exchange Act. The timing, number of shares repurchased, and prices paid for the shares under this program will depend on general business and market conditions as well as corporate and regulatory limitations, prevailing stock prices, and other considerations. The Repurchase Program may be suspended or discontinued at any time and does not obligate us to acquire any amount of common stock.

Previous wording

Our authorized share capital consists of 1,000,000,000 shares of stock, consisting of 900,000,000 shares of common stock, par value $0.00001 per share, and 100,000,000 shares of preferred stock, par value 0.00001 per share. As of July 31, 2024, 71,047,390 shares of common stock were issued and outstanding. In addition, as of July 31, 2024, we had 5,086,521 shares of common stock issuable pursuant to 5,086,521 pre-funded warrants, 4,431,698 shares of common stock issuable pursuant to 4,431,698 exercisable outstanding stock options, 4,310,310 shares of common stock issuable pursuant to 4,310,310 outstanding options that were not exercisable at that date, and 1,363,789 shares of common stock issuable upon vesting of outstanding restricted stock units.

Current wording

Our authorized share capital consists of 1,000,000,000 shares of stock, consisting of 900,000,000 shares of common stock, par value $0.00001 per share, and 100,000,000 shares of preferred stock, par value 0.00001 per share. As of October 30, 2024, 68,877,526 shares of common stock were issued and outstanding. In addition, as of October 30, 2024, we had 5,086,521 shares of common stock issuable pursuant to 5,086,521 pre-funded warrants, 3,770,708 shares of common stock issuable pursuant to